Tax Bulletin - July 18, 2016

Kolkata Tribunal Special Bench Ruling (Tribunal) – Whether an arm's length price adjustment was required to be made in respect of interest free loan granted by the assessee, a non-resident company, to its wholly owned subsidiary in India?

Instrumentarium Corporation Limited, Finland vs. Assistant Director of Income Tax International Taxation I Kolkata [ITA Nos. 1548 and 1549/Kol/2009]

Facts:

Instrumentarium Corporation Limited (ICL Finland or assessee), is a company incorporated in and tax resident of Finland. ICL Finland is engaged in the business of manufacturing and selling medical equipment, and it has a wholly owned subsidiary in India i.e. Datex Ohmeda India Pvt Ltd (Datex India or associated enterprise or AE) which acts as ICL Finland's marketing arm for its products in India.